A resignation can seriously impact a business, no matter who it is in the company that has resigned. However, when a company director resigns, it can leave other employees wondering what to do next. Company director resignations are rare, but they can happen, and when they do, it can be difficult to understand how this will affect the company and what steps are needed to ensure the continuation of the smooth running of the business.

Depending on how sudden the resignation is, many factors need to be considered before the business gets back on track, such as the appointment of a new company director.

So, we’re explaining how you can deal with the resignation of a company director as effectively and efficiently as possible with the help of CRO’s services.


Reasons Why a Company Director May Have to Resign

There are plenty of reasons why a company director may have to resign, some more expected than others.

  • Retirement. In this case, the resignation of the company owner would be expected. Sometimes, the owner will put their business up for sale. Other times they will gradually phase out control and pass their responsibilities to another team member until their retirement date.
  • If the company owner is relocating too far for it to be possible for them to continue to act as the director, they will often resign. This can be sudden but often with enough time to make the all-important decisions before they leave.
  • Accident or illness. This is often incredibly sudden and means the director will resign if they have been in an accident or have fallen ill and can no longer fulfil the role.

woman leaving job

  • Domestic situations and changes can distract any employee from their work obligations, even a company director. Whether it is a divorce, a new baby, or other commitments, they may no longer be able to carry out their role.
  • Company disputes. Sometimes, if there have been disputes and tension within the company, it can escalate and lead to the resignation of the company director for the best outcome of the business.
  • The desire for a new challenge. If the company director has had the same role for a considerable amount of time, they might just feel like it’s time for a change.


How Can a Company Director Resign?

The resignation of a company director differs slightly from the resignation of other employees. There is a strict protocol that they must follow to ensure it is done professionally and officially. If you’re unsure of where to start, our company secretarial services can help, and we will guide you step-by-step, ensuring each stage is completed appropriately.

  1. Consult your contracts. This will ensure you are being compliant and will avoid any disputes.
  2. Inform any other directors. As your responsibilities will fall to other directors, informing them straight away is essential.
  3. Inform stakeholders. This will provide them with their new point of contact.
  4. Inform Companies House. The team within our ad hoc company secretarial services can ensure that all forms are filled out and sent to Companies House accordingly.

Although it may seem complicated, the process is simple, and with our help, it’s even easier. Take a look at our meeting minutes services and enquire online today to get started.


Who Will This Affect?

If completed appropriately and professionally, this shouldn’t have too much of an impact on the majority of the employees, depending on the size of your company. However, in emergency situations such as an accident or illness, a director’s resignation can significantly affect the business.

director leaving company

If there are other directors, they will automatically absorb the responsibilities and act as the point of contact for the resigned director until they may see fit to appoint a new one. In businesses with no other directors, a new company director must be established.

Appointing a New Company Director

Appointing a new company director is not much different than when you registered your initial director through online company registrations at the beginning. Our Direct Cosec Services provide you with everything you need to make the smooth transition from one director to another. It is the director’s responsibility to ensure that all company records are up-to-date, so both the old and new directors should work together to make sure that this happens if this is possible. Furthermore, our job is to guarantee that all parties are being legally compliant, as failure to comply is a criminal offence.

In addition, we also offer company secretarial software, which allows you to make changes to your company legally, cost-effectively, and efficiently. CompanyView Secretarial Software is easy-to-use, with little to no training required to get the most out of its functionality, allowing you to register your new director quickly with no hassle.

If this sounds like a service your company needs, or you would like some more advice on how to deal with the resignation of a company director, please don’t hesitate to enquire today.